I guess the point I have been belaboring all along has been that it was never very likely that the Baby Bonus would result in lots more middle-class babies born and it was always conceivable that is would result in more babies born into less than ideal family environments. But, if you simply want to compensate mothers in some sense for the additional costs they incur as a result of having children you can do that, without having any specific behavioural goals in mind. I don’t think the baby bonus is the best-designed policy to achieve that objective though.

It is worth remembering though that the only reason that we have a Baby Bonus was that the previous government didn’t want to implement any kind of paid maternity leave safety net for the group of women who clearly did forgo income in order to stay home with their newborn babies.

While I think it is true that the Baby Bonus would cause very few people to deliberately have more children than they would have had anyway, there have possibly been other behavioural changes. For example, the availability of additional assistance may enable people to start their families earlier than they otherwise would have. And to the extent that they do that, some could end up having more children in total just by having more time in which to complete their families. But I agree that the effect would be pretty marginal in aggregate and all of the evidence suggests that this is the case.

On the other hand, I am pretty uncomfortable with the very idea of providing a positive financial incentive for people to have more babies. This is because I’m not sure that people who would respond to such an (in the end, fairly minimal) incentive are the best people to be encouraging to have more children. As we have discussed, they almost certainly would not be drawn from the higher parts of the income distribution.

To me though I think that changing people’s behaviour one way or another is hardly ever the best rationale for any policy intervention. I tend to think of behavioural outcomes as the necessary consequences of policies that you implement for other reasons. So if the purpose of the Baby Bonus is to compensate mothers for various costs associated with giving birth to the next generation, because you (society) think that is worthy of compensation, then it can be evaluated in those terms as success or failure. And in the process you can take account of behavioural side-effects, both good and bad.

But I think there are issues here, with a growing minority missing out not just on jobs and money, but also relationships and families. Bob Birrell has been tracking this for some time. Public policy, however, is increasingly rewarding those who whose lives have in fact already turned out well - members of intact families. Of course I am not a philosophical egalitarian, but I think even people who are should have good reason to question this.

I stand by my more substantial nitpick though - that comparing the average household in each group (even if in terms of equivalised income) is not necessarily all that meaningful.

And my previous comment was meant for NPOV of course.

It’s just that he totally miscalculated the amount that you would actually have to give middle-income families in order to significantly change their behaviour. Women who understand the direct and opportunity costs associated with having children were never going to start popping them out in return for the Baby Bonus and a bit of extra FTB.

It certainly would be interesting to know whether and how the socioeconomic profile of mothers has changed over the past 10 years. But I would go for more reliable indicators of SES, like education and occupation, rather than simply income.

Andrew - I don’t quite understand what you mean by higher expenses, here. If it is the higher expenses consequent on living alone, that is surely what equivalising is supposed to do?”

I meant the higher expenses of having kids. From memory, a young child is classed as 0.3 of the single person in terms of added expenses to the household. So in order for the household with the child to have the same living standard as the household without the child they would need to earn/receive significantly more than the single household, which in fact they now do. Though people with kids have more expenses, they have virtually the same disposable income as a single person.